Answer the following statement(s) true (T) or false (F)
1. Oligopolies earn zero long-run economic profits.
2. An oligopoly has a low concentration ratio.
3. The concentration ratios for U.S. industries fail to account for foreign competition in
those industries.
4. Competition is restricted by government regulations that impose barriers to entry to an industry.
5. Economies of scale exist when a firm’s long-run average total cost increases as its output increases.
1. FALSE
2. FALSE
3. TRUE
4. TRUE
5. FALSE
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Suppose that a technological decline makes labor less productive. What is likely to happen to wages and to potential output?
A) Wages decrease and potential output increases. B) Wages increase and potential output decreases. C) Wages increase and potential output increases. D) Wages decrease and potential output decreases.
Refer to Figure 11-11. For output rates greater than 20,000 picture frames per month
A) the firm will not make a profit because the average cost of production will be too high. B) the firm will experience diminishing returns. C) the short-run average total cost will equal the long-run average total cost of production. D) the firm will experience diseconomies of scale.
Modern liability management has resulted in
A) increased sales of negotiable CDs to raise funds. B) increase importance of deposits as a source of funds. C) reduced borrowing by banks in the overnight loan market. D) failure by banks to coordinate management of assets and liabilities.
Price discrimination results in _____________ than would be observed under a single-price monopoly
a. higher output and lower costs b. lower output and higher costs c. higher output and higher costs d. lower output and lower costs